Correlation Between Orbit Technologies and Augwind Energy
Can any of the company-specific risk be diversified away by investing in both Orbit Technologies and Augwind Energy at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Orbit Technologies and Augwind Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orbit Technologies and Augwind Energy Tech, you can compare the effects of market volatilities on Orbit Technologies and Augwind Energy and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Orbit Technologies with a short position of Augwind Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orbit Technologies and Augwind Energy.
Diversification Opportunities for Orbit Technologies and Augwind Energy
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Orbit and Augwind is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Orbit Technologies and Augwind Energy Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Augwind Energy Tech and Orbit Technologies is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Orbit Technologies are associated (or correlated) with Augwind Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Augwind Energy Tech has no effect on the direction of Orbit Technologies i.e., Orbit Technologies and Augwind Energy go up and down completely randomly.
Pair Corralation between Orbit Technologies and Augwind Energy
Assuming the 90 days trading horizon Orbit Technologies is expected to generate 3.29 times less return on investment than Augwind Energy. But when comparing it to its historical volatility, Orbit Technologies is 3.17 times less risky than Augwind Energy. It trades about 0.28 of its potential returns per unit of risk. Augwind Energy Tech is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 41,670 in Augwind Energy Tech on August 29, 2024 and sell it today you would earn a total of 14,830 from holding Augwind Energy Tech or generate 35.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orbit Technologies vs. Augwind Energy Tech
Performance |
| Timeline |
| Orbit Technologies |
| Augwind Energy Tech |
Orbit Technologies and Augwind Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orbit Technologies and Augwind Energy
The main advantage of trading using opposite Orbit Technologies and Augwind Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orbit Technologies position performs unexpectedly, Augwind Energy can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Augwind Energy will offset losses from the drop in Augwind Energy's long position.| Orbit Technologies vs. Ormat Technologies | Orbit Technologies vs. Multi Retail Group | Orbit Technologies vs. Nova | Orbit Technologies vs. B Communications |
| Augwind Energy vs. Opal Balance | Augwind Energy vs. B Communications | Augwind Energy vs. Holmes Place International | Augwind Energy vs. Nova |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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